Type 2 diabetes mellitus (T2D), a formidable and growing challenge to the VA healthcare system, represents a heterogenous set of hyperglycemic disorders involving impaired insulin secretion, insulin resistance, and increased hepatic glucose production. Both insufficient insulin secretion from β cells and dysregulated, typically increased, glucagon secretion from α cells, contribute to the hyperglycemia in T2D. While many hypotheses and models exist, the molecular mechanisms responsible for human islet dysfunction in T2D are incompletely defined and largely unknown or unproven. Most models and hypotheses about the T2D β cell arise from studies of rodent models and have not been confirmed or tested in human samples. Because of the many differences in human and rodent islets, it is critical to study potential regulators in a human islet context and that will be a focus of this proposal. This proposed studies are based on evidence that islets from donors with short-duration T2D have impaired insulin secretion, enhanced glucagon secretion, and reduced expression of PAX6, an islet-enriched transcription factor recently shown in rodent systems critical to islet β cell identify and functional maintenance. Very little is known about the role of PAX6 is human islet cells. The proposed studies will test the hypothesis that PAX6 is required for normal human α and β cell function and that reduced PAX6 expression contributes to T2D islet α and β cell dysfunction in these aims: (1) Determine the functional and transcriptional consequences of PAX6 transcriptional control normal human islets in vitro; (2) Determine the functional consequences of PAX6 loss from normal human α or β cells in vivo; (3) Assess whether PAX6 loss in short-duration T2D islets is reversed by treatment with a Glucagon-like Peptide-1 (GLP-1) agonist. By employing innovative experimental approaches such as creation of human pseudoislets in which gene expression can be modified and transplantation of genetically modified human pseudoislets into immunodeficient, glucagon-less mouse model (NSG-GKO) to allow for the assessment of α and β cell function in vitro and in vivo, these studies will expand our understanding of the molecular processes regulating human α and β cell function and islet dysfunction, leading to new clinically actionable information for T2D treatment.